Now is OUR time to be the Value Innovation Generation.

Walk into any decent marketing program or marketing subject and the first piece of reading you'll be asked to complete is Marketing Myopia by Theodore Levitt.  His 1960 Harvard Business Review article was a ground-breaking piece of thinking that introduced some of the most influential marketing ideas of our time.  Levitt was able to articulate a profound warning (and explain the consequences) to those industries and businesses that remain focused on mass-producing more and more of the same product; thinking that there will always be someone on the other side to buy it at a profit.

I encourage everyone from the agricultural industry to read it, with the industry in mind. It's a great lesson in being market-centric, not product-centric; and defining the purpose of your industry correctly.

The article is full of answers to the greater question that I see on many peoples faces; that is 'how is it that after being told to invest my equity into increasing productivity, because I was also told there is a food and fibre boom and everyone wants my products, I am now making less money than ever before?'


In 2008 the South Australian Government's Thinker in Residence was Professor Andrew Fearne, an international expert on value chain thinking who was here to review and provide inspiration for the food and wine industry.  He gave a detailed assessment of how effectively we are value-adding our food and wine products.


His final report in 2009 started like this: 'an overwhelming sense of denial. She'll be right. The rains will come. Governments will fix this. Somehow something will change - that means we can carry on the way we've always acted before. That's, I think, fundamentally the vulnerability I see. Instead of asking what it is we should be producing in the first place - expecting, wishing and hoping things will sort out; so we can carry on doing the things that we've always done before.'


He warned our food and wine industries to not just keep producing more and more of the same.


Today I read the following comments from a recent food industry conference: 'the rapidly changing food and packaging supply industries will continue to push producers and manufacturers to innovate and improve their business models.'


'If you’re sitting in a company that’s not looking bright, and is not innovating, the future is not bright for you in Australia.'


I've skimmed across some pretty chunky (but reoccurring) themes to raise my point, but the future is clear - we can't keep going the way we are going, as very soon a large proportion of the industry will no longer be with us.  They'll have gone bust trying to deliver more of the same; or gone bust because we lost our markets.


So I'm putting the call out to all of us that will be working in the industry over the next 20 years: I declare that we are the Value Innovation Generation and we have the next 20 years to pull all of our industry and Government sectors together and start working as an industry fraternity and alumni, hell-bent on making sure that when our job is done, Australia (as a whole) is a global marketing force to be reckoned with for food, fibre, wine and others.


Now there's an industry I would want to work in, if I was deciding what to do and study after secondary school.

Packaging gone mad.

I must admit that when I ordered our new accounting software from MYOB online, I wondered what was going to be in the box - given it's size.

Guess what - a big fat nothing!

The box is held into shape with a framework of more cardboard.

Come on MYOB - you could have sent me the disk and booklet in a nice envelope.

How is it that in 2012, leading products are still getting away with wasteful packaging like this?

I guess in some ways the carbon tax will force many companies to re-think their packaging (emission) strategies - and will provide them funding to do it.


Less packaging = less carbon tax.

I see a huge CSR marketing opportunity for MYOB - can they?

Buying Australian wine is very confusing..........so I don't.

I'll come straight out and say it.  I have absolutely no idea what most wines companies are saying when they describe their products in their marketing collateral.

I make this statement because I consider us a perfect target-market for the wine industry.  Educated young professionals, double income no kids (DINKS), working hard to maintain a certain lifestyle that includes having a few nice drinks.

Over the last few months I've been looking at how the wine industry promotes it's products and it comes across as being very 'in-house' - as if everyone is talking amongst themselves.  As a potential consumer I feel on the outer for not understanding wine making chemistry and edaphology.

So I said to myself "self, who are the top selling wines in Australia and is it easy too see why people are buying them."

The best I could find was a 2010 report on AC Nielson sales data for the Australian wine industry that listed the top 25 selling wines in Australia.

Yellowglen made number 1 and had 4 wines in the top 25.

5 of the 25 were cleanskins?!

5 were from overseas - 4 from NZ and 1 from Italy.

The ol' Passion Pop made number 8 on the list - what the?

I started going through some of the web sites.  Wow, what an experience.  Marketing and branding 100% dedicated to selling me something.  And all they've done is worked out what I want to get out of life and sold it back to me in a bottle.

I kid you not - I was half-way through the Yellowglen web site and I caught myself thinking "Hmmm, I might get a few of these for my wife, she'll love them."  I've never looked at Yellowglen in my life and in 10 minutes they had converted me to a purchase.

A quote from the report - his words not mine: 'Nothing sums up more how so much of the wine trade is divorced from the reality of what customers want.'

How can cleanskins, New Zealanders and Passion Pop be our most popular wines?

So who is getting my share-of-wallet on drinks?  Beer and cider winning hands down.  Cider is starting to overtake beer very quickly.

There comes a time in every man's life.................

There comes a time in every man's life, when he must sell his ute because of his wife.

It was time to sell my toy, so today I watched a stranger drive away in my pride and joy.

Although we had to part, my mistress is gone from the shed not from my heart.

It's left a terrible void, she was the only time I could just be a boy.

Why I said what I said about The Year of The Farmer

During discussions at the recent NFF Blueprint for Agriculture forum in Adelaide, some comments that I made were picked up by a journalist in attendance and included in a mainstream publication, as part of a series of feature articles on current issues in the agricultural industry:  http://www.indaily.com.au/?iid=62849&sr=0#folio=1


The young journalist did her research and wrote a well-balanced article discussing the pros and cons for how the industry goes about promoting itself.  Final copy got chopped to bits by the Editor and made no sense.

Some background

Australia is one of only 15 countries on the entire planet that are total net exporters of food and fibre products.  The majority of all that is produced by our farmers is paid for and consumed by someone overseas; not by someone living here in the suburbs.


Our reputation for food safety and quality is second to none.  Consequently, the rest of the world has plans for us.  I believe that key markets around the world have a much more advanced understanding of what their supply relationship with Australia will look like in the future, as opposed to our own level of current planning.


Perhaps impatiently, some countries are already making their move on us, to secure direct supply rather than a trade relationship. 


With that in mind, here are some of my thoughts.  Gulp!  Turns out these are the thoughts of quite a few others.  Phew!

Right message, wrong timing?

Is The Year of The Farmer the right message at the wrong time?  If I read between the lines, I think I get what it is trying to do because I live and work in the industry - but the message is not for me.  I'm worried that at this critical point of so many contemporary industry challenges, how we are currently describing/promoting our industry may be incomplete and inconsistent.  Maybe even a bit nostalgic.  Others don't have the benefit of knowing what we may actually mean.


I suppose that when you are under so much pressure for so long, you tend to move into a bit of an identity crisis.


But why showcase the industry up to the farm gate and then stop?  What happens to the food, wool and grapes after the farmer has produced them?  So many wonderful value-added products that go all over the world and into Australian homes.  Farming's contribution to national GDP is 3%.  What happens next adds about another 24% or so.  Who are the people doing all this?  Now there's a story.


But wait, there's more to the story.  That 24% includes all the inputs, technology, research and services that are provided to the farmer before anything has been produced.  All things considered 24% GDP from the rest of the industry is most likely into the 30s.  Some of the amazing advancements in this side of the industry has kept farming in the game.  Let's hear about that. 


An idea might have been to spend a year effectively marketing an entire 'agrivision' for Australia.  An exciting tale of 'food, fibre and wine - twenty twelve and beyond.'  A massive celebration of all that we do and the positive impact it has on billions of lives - every single day.  Talk about grabbing the attention of the nation.  What a chance for every Australian to puff their chest out.  They'll appreciate our industry for sure.


At the moment I'm convinced they're still not sure what it is we do.


I'm thinking that this type of promotion about our industry would have effectively delivered two key messages to those we need to be listening right now.  Firstly, educate Australian consumers how their food actually arrives on their plate - not just how it is grown.  Help them make the connection.  Secondly and most importantly, we show our key trading partners a cohesive, vibrant and dynamic value chain that is excited to know them and open for business.


The more I think about it, the immediate and lasting economic return of this type of marketing is easy to see.  Short-term stimulus doesn't cut the mustard on this one.

Feeling unappreciated?

The farmers I know are a resilient lot.  Pretty thick-skinned.  They don't like wasting money.  Heard that a million times.  Worst of all don't let them believe that money is being wasted on them.  No time for walking around slapping each other on the back, there are more pressing issues at hand.  Are they worried that some people might think they are whingers?  Not really.  Might dent the pride a little bit.  Just for a moment.  What are they after?  Real economic returns at the farm gate - RIGHT NOW.  Time is of the essence.  Just get on with business and whoever Australia needs to do that business with, to make it happen.

Catalyst for change

What will success look like in the future?  I'm really interested to know how the performance of current marketing efforts will be measured at the end.  This no doubt needs to happen given the cost and importance that it brings real-time economic results fairly quickly.  We compete with 14 other countries for a share of the export wallet.  % share of wallet = Landcruiser or Mahindra.  Let's face it - sitting at the dinner table at night we measure the performance of other peoples' buying behaviour for our goods produced, by the impact it has on our own individual purchasing capacity.

The degree of separation that now exists in Australia between farmers and the people that consume their products (locally and overseas) is ridiculous.  What happened?  Whole-of-industry initiatives are a great way for industry stakeholders that have been polarised to get to know each other.  It's very important they do know each other.

My guestimate is that farmers and consumers alike are becoming increasingly frustrated at the degree of separation established by mid-market participants.  Funnily enough they are the two most powerful in the whole process.

My tip is that Corporate Cooperatives will feature heavily on the industry landscape in the future.  If you have a mid-market business model, I would start thinking about how you are going to adapt.  The same warning has gone out in many other industries.

The end

It takes information to change one's situation.  My thoughts are just a small contribution to this enormous process we need to have.